UPDATE 1-US consumers sue Takata over airbags, seek class action

Takata Corp., the Japanese company whose potentially defective airbags have led to the recall of millions of vehicles, was sued on Monday by consumers who claimed Takata and several car manufacturers defrauded them by concealing crucial information.

Air bags made by Takata are linked to at least four deaths and more than 30 injuries in the US after the safety devices deployed with too much force, spraying metal shrapnel at occupants. The lawsuit, filed with a US District Court in Florida, is believed to be the first in the United States to seek class-action status on behalf of consumers nationwide. Though the probes are ongoing, one focus is likely to be Takata’s choice of an unusual explosive chemical to inflate its air bags in milliseconds, according to auto industry executives.

The Japanese parts maker four years older than Toyota also has said it dealt with lapses in quality control at its plant in Mexico. “No other supplier other than Takata has used this ammonium nitrate,” said Jochen Siebert, Shanghai-based managing director of JSC Automotive Consulting, which advises automakers and parts suppliers. “You could build air bags that were smaller and lighter. The National Highway Traffic Safety Administration has urged owners of an estimated 7.8 million Chrysler, Ford, General Motors, BMW, Honda, Mazda, Mitsubishi Motors, Nissan, Fuji Heavy’s Subaru and Toyota vehicles to replace their airbags. – Reuters

The unfolding crisis marks a fall from grace for a Tokyo- based company that rode Japan’s postwar industrialization to became a global powerhouse in seat belts that saved lives. Having now been responsible for making some vehicles more dangerous, Takata’s failures add to growing doubts about auto safety and how well motorists are protected by regulators. In the late 1990s, Takata made ammonium nitrate the chemical-of-choice for its air-bag inflator design, said Siebert, who was advising for the air bag market in Europe at the time. The compound went into the earliest model-year cars that have been recalled in the past two years, including BMW’s 2000 3 Series, Honda’s 2001 Accord and Civic and Nissan’s 2001 Maxima and Pathfinder. Ammonium nitrate’s weakness lies in its sensitivity to moisture, which makes the propellant unstable, said Scott Upham, president of Valient Market Research, who has followed air bags since they were first going into cars a quarter-century ago.

In 2005, Takata closed a Georgia plant that made inflators and shifted production to the Mexico factory, about 300 miles southwest of San Antonio, Texas. The factory resumed full operations within a month, and Takata’s customers managed to avoid production disruptions, a feat that Automotive News called “remarkable” in August 2006. Then-President Juichiro “Jim” Takada was halfway through a decade-long period in which his company made air bags for now-recalled cars when the top U.S. auto-safety regulator presented him with an award in 2005 for improving auto safety. “We cannot speak to a recognition provided a decade ago,” Brian Farber, a Transportation Department spokesman, said of the award in an email. “Today we continue to aggressively investigate this faulty airbag and will leave no stone unturned in the name of public safety.” While Takata may not be a household name outside of Japan, it shares roots with Toyota, the world’s largest automaker.

Both started in the 1930s as part of the country’s textile weaving industry and were among the companies that produced equipment for the Imperial Army during World War II. At a New Year’s party thrown by Honda in 1985, Takada said he wanted his company to stay out of air bags, Kobayashi wrote in his memoirs published in 2012. “If anything happens to the air bags, Takata will go bankrupt,” Takada said, according to Kobayashi’s book. “We can’t cross a bridge as dangerous as this.” Already in the midst of battling internal resistance to air bags within Honda, Kobayashi kept pressing. The go-ahead within Honda came in 1986, when Kobayashi convinced then-President Tadashi Kume that air bags, with their “one-in-a-million” defect rates, would enhance the automaker’s reliability, Kobayashi wrote. Honda spokeswoman Akemi Ando said she would check on Kobayashi’s account of the company’s history and said the automaker doesn’t approve new technology unless it’s safe. Going forward, the task of protecting the legacy of his family’s 81-year-old dynasty falls to Shigehisa Takada, grandson of Takezo and son of Juichiro, who died in Tokyo in February 2011 at the age of 74.

Shigehisa, 48, ceded the role of president last April after six years on the job, a month after Toyota, Honda and Nissan called back a combined 3 million vehicles because of defective Takata air bags. I think Takata’s management may have underestimated the fallout.” With assistance from Rawnna Low in Hong Kong; Jeff Green in Southfield, Mich.; Masatsugu Horie in Osaka, Japan; Hideki Asai in Tokyo and Jeff Plungis in Washington